Volkswagen undertakes to fix consumer guarantees approach

7 September 2018

The ACCC has accepted a court-enforceable undertaking from Volkswagen Group Australia (Volkswagen) to improve compliance with its consumer guarantee obligations under the Australian Consumer Law (ACL).

Volkswagen has undertaken to review past complaints, and offer refunds, replacements or repairs to customers where consumer guarantees rights were not honoured.

“We have successfully sought Volkswagen’s commitment to improve its complaints handling systems to ensure compliance with the automatic rights consumers have under the Australian Consumer Law, which cannot be excluded, restricted or modified,” ACCC Commissioner Sarah Court said.

“Today’s action ensures Volkswagen will place consumer guarantees under the Australian Consumer Law at the centre of their approach to consumer complaints, as every car manufacturer should do.”

Volkswagen has also undertaken to establish a ‘60-day policy’, where it will offer refunds or replacements without the need for a consumer to demonstrate a major failure, if a defect prevents a vehicle from being driveable within the first 60 days after purchase.

The ACCC acknowledges this policy goes beyond existing ACL obligations and reflects a recommendation of the ACL Review.

“We are pleased Volkswagen will offer its new car customers remedies in some cases beyond what the law requires and believe this positive step will be appreciated by new customers,” Ms Court said.

Volkswagen has also committed to providing customers with written reasons when a remedy requested by a consumer is not agreed to.

This undertaking is part of the ACCC’s ongoing work to seek responses from manufacturers, such as Volkswagen, to the ACCC’s concerns about industry-wide non-compliance with consumer guarantees.

“We will continue to pursue manufacturers to ensure they are honouring the rights of consumers under the law,” Ms Court said.

The ACCC’s extensive new car retail market study identified industry-wide issues with the way car manufacturers were handling consumer guarantee complaints.

Volkswagen’s court enforceable undertaking is available at: Volkswagen Group Australia Pty Ltd

Notes to editors:

Volkswagen’s undertaking is unrelated to the ACCC’s continuing litigation against Volkswagen and Audi for alleged false or misleading diesel emissions claims.

This undertaking applies to Volkswagen-branded cars only and does not apply to other sub-brands of the Volkswagen group, including Audi, or Porsche.

Volkswagen’s undertaking is one of a number of outcomes the ACCC has achieved in the last two years to create change in the new car industry. This includes action taken against Ford and the court enforceable undertakings accepted from Holden and Hyundai.

The new car retailing market study final report is available at: New car retailing industry market study final report

Release number: 
MR176/18
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